I don't know specific law in Washington but generally everywhere deposits can only be held for actual losses.

The benefit of them is that in most cases you insulate other properties outside the LLC if you have a loss. 

However, with this potential for monthly loss, even though it is a minor dent to my income, I am wondering if I made the right decision.

Indy Class C #2 sell it and cut my losses or try to rent out at -$200 to -$250 cash flow (got an honest property manager feedback) and hope it stabilizes in 2 to 3 years.

I’m curious to see if this is a loss cause or if there are ways to turn this into an opportunity to make some money.

When speaking to the listing agent, she could not tell me any information on his financing situation and only stated that the seller knew he would be selling his home at a loss.

The rental income loss cannot be included as income for last year (2018).   

I want to help her out but also want to avoid significant financial loss.

I learned a lot and maybe will come back to STRs when I don't have to overpay to get in, but I'm selling it right now and not looking back while I have the opportunity to offset my cap gains with all our losses.

@Carlos MartinezAlso ask for loss runs, if there have been any claims for the past five years.